Gentlemen, on behalf of Canaccord, thank you and welcome. Great to have you here. Thank you for having us. Thanks. Yeah. Let's kick off with the big obvious question as it relates to federal reform. We are on the cusp of the single biggest regulatory change in 50 plus years in the industry. Can you provide a little insight here just into how investors should think about the economic impact on your business model, that of your competitors, and also separately on the issue of the uncertain tax provisions? Sure. Great question. We already had a monumental change with the treaty around medical cannabis. For us, we already said that 60% of our retail sales plus are medical, so that has gone into effect, which is a big change for us. As we wait for the recommendation from the ALJ hearing, which could again be a big shift, because that will include the entire plant, which is great for our business, and that is a number of things. For us, the opportunity, which Aaron talks about all the time, is to have Visa, Mastercard. Our dispensaries are still cash only for the most part with a little bit of debit transaction here and there, but that is a big shift in our business. From a tax component, obviously, we pay this 280E tax issue that we have had from day one is a big issue for us. We already implemented the medical-only component, which has gone away, but getting the rest of that done within our balance sheet is going to be big for us. Everyone is talking about the retroactive tax relief that was in the recommendation. That is something that we are working on with the administration, and we believe that will come after the recommendation from the ALJ hearing, and that will address the UTP. We talk about this, what you see today on the UTP is not necessarily what is going to happen. There will be some relief there. We do not know what it is yet, so we do not want to comment on what that number is, although we have a strong feeling of where it could land. It will be a big relief for Verano and the industry at large. When you look at what has happened on the other side of the cannabis plant, which is hemp, which has been paying zero tax, there is really no difference there. There are some big wins that are ahead for us, something we have been working on for a long time. The administration has been very pro-business and has been listening to the issues that we have had, which has been a change from the last dozen years that we have been doing this. It is a lot of positive momentum. I would say this too, just to add, there is a lot of layers to what the economic impact could be to our business. The easy thing to focus in on is 280E relief. We have quantified it on calls at $80-plus million. When you actually think about being a normalized business, getting credit cards, what does that do to basket sizes? The regulation on hemp, you have a $30-plus billion market that could potentially come back into the legal channels. We start to look at interest rate reductions and debt facilities. Even if and when we get uplisted, we just did $2 million of a share repurchase last quarter. When you can tighten your bid-ask spread because you are trading more efficiently and you have more backing of the stock, now you can execute share repurchases more efficiently. We don't quantify the cost of how you execute a share repurchase, but just being a normalized business, the economic impact is really hard to quantify, but it's going to be across the board. I think to that point, as you said on the debt piece of this, you're hearing numbers of 300 basis points or better by way of improvement in available rates on the full rescheduling of the plan. Certainly pretty material for you and any of your competitors. Well, something to talk about with our debt facility is the flexibility that we have built into that. We have a $195 million term loan, 1.5% prepayment penalties in years one and two, and zero in year three, and this was George and team understanding that, first of all, we can leverage the fact that we have no sale leasebacks. We're a real estate-backed company, especially once 280E goes away. But when you can leverage real estate to get these industry-leading rates, and right now we're at 9.5%, which is 5.5-plus SOFR. It's like getting a 20% credit card and jumping up and down. We've built flexibility in light of potential moves like that to be able to take advantage of those. Right. Fantastic. George, Florida, you guys have proven very adept operators. You are the strong number two in that market. You have also recently been calling out an acceleration of growth, whether it is within the existing medical as you continue to add depth in that market or on a potential transition as we look to change in governorship and the like looking to 2027, 2028. Provide some thoughts around both the backfill in terms of medical, how you have done what you have done, and how you think about that growth and the evolution of growth as we look to it potentially becoming an adult use market. Sure. Couple things there. My new home state, I love Florida. Obviously, a lot of people moving to Florida, so we view it as a big growth market just because of the influx of people from multiple states across the country and internationally, by the way. That market was a market that we had begun AU preparations in a big way. We scaled up our current facilities, and we added a massive facility to have the AU big jump that we had anticipated. Wouldn't have changed that decision despite what happened with the current governor. What we see now is with the administration who has been very against cannabis leaving, we have who we feel the new governor will be, very pro-medical cannabis. What does that mean? We are in a program that is very tight today. We cannot advertise. There is no telemedicine. There is no reciprocity. There are multiple form factors that are not allowed. When we work with the new administration, we feel like we can unlock those things. We can take that 900,000 patient count and add a massive gain there. We are one of the companies that can benefit greatly from that because we are prepared for it. So we have a big store count. We have, more importantly in Florida, because it is a vertical market, 100% vertical, we have the ability to scale up quickly on the cultivation side and be able to actually give product to these new patients coming in. We feel like Florida could be one of our biggest unlocks. We have some other unlocks as well, which I am sure you will go into in Virginia and Texas, et cetera, but Florida is going to be a big unlock for us, even just on the medical side for years to come. When that AU transition does happen, it will be massive. I think that's a good segue to the discussion around Virginia. That's a market that the illicit market was always believed to be around $1.6 billion. In Virginia, the third largest in the U.S., there's been some commentary recently in the public domain around it potentially being a $2 billion-$3 billion of addressable market when you layer in the hemp or the potential hemp unlock. You guys, very well positioned in terms of your footprint there. One of only, let's call it three and a half players emotionally in the market, ready to go. July 1, 2027, that market starts. Where are you in terms of readiness? What's your biomass availability like, and how prepared are you for what could be one of the biggest starts in the last five-plus years? We are ready, as ready as we could be. We just got our second facility approved last week, so we'll go to max canopy. We're in the Virginia Beach region, which is one of the best regions in the state, 14 million-plus tourists. We're going to move a couple stores, which will be done before the July 1st deadline, just to be able to have the parking capacity that we need and the POS capacity. Obviously, we're used to this. We've done it many times. We expect a massive uptick in Virginia. It's a phenomenal state. We've got huge population, big tourism. It'll be the biggest jump we've had since New Jersey. It's right on the cusp of happening. We had hoped it was going to happen this year. That was the game plan. We ended up with something better. The governor stepped in, vetoed the bill that was in place, and it will be a much more thoughtful market. When you view it in terms of long-term, which is important to us, this will be better, I believe, than what happened in New Jersey, because there will be a much more limited store count, and they're going to only add stores as the business increases, which is a much more thoughtful approach. Which is great, because the legislators are learning from the mistakes of the past from other states. It'll be a big deal for us and a big deal for the industry. It'll set off that Southeast. With the ALJ hearing coming up and the recommendation done, we feel that the Carolinas will go, Wisconsin. It's going to have big implications, so we want to see a very successful launch here. I know the other operators are getting ready as well, so it'll be a nice cannabis story for everyone next summer. That's, I think, very true and very long overdue. We've all been waiting on a positive catalyst here, and I think we have a number of them coming. On top of the Virginia discussion, potential changes in Florida, there is also obviously the option value around the hemp unlock, and I think that's underappreciated. It's $25 billion- $30 billion of leakage into the hemp business post the Farm Bill and that loophole. The story here that I think needs to be told as it relates to the MSOs is the reset of that growth algorithm, that if the ban goes through, whether it's pushed back a month or not, but the assumption right now is it'll go through, some percent of that will be recaptured in each of the next one, three and five years. That takes this business from being a low single digit near X growth business, which has been a frustration for investors, into, again, to hear certain people frame it, 10% to 15% and perhaps even the 20% a year type growth pre the Farm Bill. How are you thinking about hemp unlock going after and addressing that market? What does that mean on the ground? We all talk about it in theory in terms of an unlock. How do you block and tackle and compete on that unlocked $25 billion over the next number of years as you claw it back from that market? Well, first and foremost, it's a long time coming, right? Basically cannabis was legalized and the legal market wasn't included. What's happening here is you have unsafe product hitting shelves across the country that's accessible to kids, which never should have happened. It's being addressed now, which is obviously for the greater good of all, not just the cannabis, the legals cannabis industry, but for our own kids. So it had to happen. It is happening. How do we get ready for it? We continue to grow, right? You saw what hemp did to us as the legal industry the last couple of years. So we're looking forward to the double-digit growth again. There's still a political game that has to be played there. So enforcement has to happen. So once this happens on the federal level, state level enforcement has to happen, similar to Ohio. We haven't even seen the full effect because enforcement doesn't happen day one. It takes time. As this continues to happen across the country, we expect double-digit gains in the cannabis industry, and the one positive that came from it is you see so many more additional users come into the space. I call them THC users, not necessarily hemp or cannabis. You see, for instance, Texas, which, again, I know Aaron talks about this all the time, $4 billion plus in the hemp industry. Again, THC market. We've never gone into a market before that's had that many THC users out of the gate. So we believe the ramp-up there could be greater. Same thing with Florida, in my home state. You drive around, you see, quote unquote, "dispensaries" everywhere. They're illegal dispensaries. Yeah. Again, with the incoming, who we feel the governor's going to be next, very pro shutting that down. When you look at one of our biggest footprints in the country, if you eliminate the illegal hemp industry from Florida and you add onto the medical cannabis industry all the things and form factors that we need, I view it as a huge uptick in our business there. This is happening across the country, Pennsylvania, Illinois, all these states have these illegal dispensaries and smoke shops and gas stations with all these products that shouldn't be there. They're not safe. I think more broadly to your point on enforcement, that's often been the issue is while there have been laws in place, there's been this aversion to any real enforcement. Certainly the way Ohio has leant into enforcement out the gate, the way Nevada is leaning into hemp enforcement, is it fair to characterize it as there is just a greater will or interest in enforcement action now than perhaps there was in previous administrations where whether it's that they have the means, whether it's that they have the support, certainly it appears that there is a real want to level set, whether it's the playing field or just more broadly have a tighter control on the market. Yeah, as this thing exploded, the education wasn't there. Yeah. The legislators in every market, they didn't know what was happening. Even today, right now where we sit, they're still not aware of exactly what's happening. Because there's a little bit of an effect of we think we're doing something good, but the opposite's happening. We're educating all of our legislators. We continue to tell everyone, let everyone know what's happening. Go to these gas stations, see what's happening. Where's that product coming from? It's not tested. Where was it sourced from? Whereas you go into a dispensary, you know it's been locally grown, it's been lab tested, it's gone through heavy restrictions. We want a safe product. We need a thoughtful approach to THC, and that just went out of bounds. Yeah, it was an industry where, if you actually look at it, hemp came through the Farm Bill. People looked at it as CBD, but in reality, it was flowing into the gas station. All those stories and headlines you would read of a teenager getting their hands on a 1,000-milligram edible and having psychosis or this or that, we were getting blamed for the sins of the hemp industry. They were taking $25 billion- $30 billion out of the market. You look at Ohio, up mid-teens in Q2 following the ban at the end of March, $24 million alone in April year-over-year growth. It's at the beginning stages, but this is going to be a phased approach. Again, to George's point. But in a second. Just on the issues of way better product in terms of pesticides and all that, maybe when I was smoking weed in college. The potency issue, it's way more potent, blowing a lot of kids' brains out. Where does the industry and you stand on the potency issue here and what we need? That's why we have a variety of products, right? We have low-potency products, we have CBD, THC products, different ratios. Just like anything else, right? Like liquor, you have. Should there be limits on potency? Should there be limits? Yeah. There are some markets that have limits, but again, do you have limits at the liquor store, right? It all plays, right? You have to have a variety of products because you have medical users that need higher limits, right? And we have medical patients that when they start titrating different products, they have to get to 1,000 milligrams. You have to have the optionality, but it has to be a thoughtful approach to it, right? Where you see the majority of the issues today is someone's going to a gas station, they have no idea. There's no one there guiding them on the product that they're buying. They're just buying products. They're buying 100-milligram drink and then they're downing it. They don't even know what the hell's going to happen. I can tell you from my own personal experience years ago, because I didn't know much about cannabis, I had a drink. I had to go put myself in a room and just knock myself out for 12 hours and sleep because there was no one there to guide me through that process. No one's going to do that at a Citgo, 7-Eleven, or a liquor store and tell you, "Hey, you should be very thoughtful of how you dose with this." Where at a dispensary, we have people that are trained on, okay, if you're a new user, start with 2 milligrams, right? See how do you react to that? And then as you increase, if you need to increase, go by 2-milligram doses, right? Or through a different product. But you're not getting that in these other places, right? That's where the danger becomes. It's all about education. And you're not going to get that at a gas station. It's a lot more challenging for kids to get our product, right? Because you have to go through dispensaries. And to George's point, you go in, talk to a budtender, and kind of see where you want to be. Going into a gas station, you can get your hands on anything, so. We've touched on the hemp unlock, the $4 billion in Texas. That's obviously a market where you are positioned and perhaps one of the top two by way of your positioning. Speak to, outside of the obvious appeal and the running start of it being a $4 billion of hemp market today, speak to also some of the restrictions around that market in the early stages, why it's not going to be a big spend market to initially go after that growth, being oil versus flower, and just help people understand those competitive dynamics. What is it going to take in terms of capital to win? What does winning look like inside of any reasonable forecast window given the 2028 ramp? Obviously, 2027 will give you that, but 2028 is when this really starts to become real numbers. So sort of speak to how you're thinking about the opportunity and capturing it or even over-indexing in Texas. Texas, you have 30-plus million people plus tourism. It's a huge market. No flower today, which is a big component in the cannabis business. We'll look at it similar to early days in other markets, like Florida, for example. We'll have our oil-based products, and we will ramp accordingly with the market. We'll always look to find a facility that we can add kind of modularity, add rooms as the market grows. In terms of capital, we have the capital to do it. We have very strong cash flow. We can build out where we need to. In terms of how the market works, we'll have to open a dispensary in every region, which we're ready to do. We'll deploy all of our brands in the oil-based products, tinctures, pills, et cetera, and we'll work with the legislature to add flower as soon as we can. But it's going to take at least a couple of years, right? I don't think we see much of anything in 2027. First of all, they haven't even issued the actual license yet, so we're still in that waiting stage. But I think it's more of a 2028 story and beyond. But with the right work. Sorry to cut you off. Yeah, go ahead. It's fine. That ultimately will become probably the best market in our portfolio, right? With that big of a population and being it's a red state, I think they'll keep it very tight. They're watching what's happening in other states. It's a huge growth factor for us in the future. Well, then we go back to the economic unlock that you talked about with regulatory moves. You think about 280E relief and more cash coming in. We're positioned really well in the States. We've already built out in Florida and Virginia, and you look at the term that we talked about, term loan and being able to maybe enhance your balance sheet by saving on interest and all that could go into a state like Texas. The way that we've positioned ourselves is once regulatory moves happen, we really don't have a lot of cleanup to do. We have money that we can invest either into expanding our footprint or looking at a state like Texas. Right. No, that's some useful insight there. Let's just pivot quickly to the discussion around M&A. There's a headline or two this morning. There's been certainly increased chatter in the broader market around the opportunity. A number of the more acquisitive operators stepped back over the last year or couple of years, whether it was capital constraints, market dynamics, or some combination of both. We're increasingly hearing across the public space increased appetite for consolidation, a need for consolidation as we start to do a real cleanup and the space grows up a little. How are you thinking about and how will you look to participate in that next wave as it rolls through? Because I think it's fair to start calling it a wave, or at least there's a wave coming, and it seems to be pretty near-dated. A couple things there. One, yes, there was a step back, and it was two things. One, maybe capital constraint, et cetera, people cleaning up businesses, but it's also working with the legislators to change rules and the way we look at every individual market. When you see an AU launch, there's always a proliferation of licenses, whatever that looks like. You see a lot of the new entrants that are in a position where they can't be successful. There's a situation now where we've now worked with the legislators and we can partner up with these individuals. For us, when we look at M&A, it's better for us from a return perspective to add on to states that we already have big cultivation. That'll most likely be our primary focus. Since we already have growth drivers in Texas and Virginia and kind of within our portfolio, we want to continue to do that within our own portfolio, add store count where we have significant cultivation. That will most likely be the approach for Verano. Yeah, we have never been shy on M&A. When we went public, in the span of a year, we did 16 acquisitions, and then we paused. We always have conversations, and we are always hyper-patient. Then Virginia, Arizona popped up, and we executed on that. But I think- Yeah. What we have been able to do as a business is not rely on M&A for growth. If you look at our last quarter, we were up 6%, year-over-year on the top line, third quarter in a row that we had sequential growth. So what we are really doing is really nurturing the organic side of our business and then want to potentially layer in the M&A to only enhance that. We have a lot of market. The rules just change right where we are standing right now. Massachusetts, three stores now to five, next year to six, and the opportunity to partner with and make JVs. So, it was a market where we actually shut down our cultivation because there was an oversupply and we could not have enough stores. That is now changing. So the goal is for us to reopen our cultivation, add store count. We can do the same thing, add stores in New Jersey, add stores in multiple places across our footprint, which when you can add the vertical integration to it, is a great uptick for us. So that will be the goal. That's great. Gentlemen, I think we're at time, but a quick question there. Yeah. Let's stay on the M&A thing for a second. If you look at the price in any mature market, whether it be Michigan, Massachusetts, it doesn't matter where you go, the price of flower just craters after generally years three through five. You look at store traffic counts in dispensaries, it's pretty anemic compared to most other retail formats. The industry needs consolidation. There are a lot of weak players, and there's a lot of state initiatives to support the local non-MSO communities. If you're really going to be a long-term investor in this, you got to wait out that storm. Can you tell me in your crystal ball how you see consolidation playing out and distinguish between the limited licensed states, like dispensaries in Massachusetts, five to go into six, unlimited in Florida, where basically there's six competitors within three square blocks of each other. How do you see it and how does it play out for you? Right. Every market's different. You bring up Michigan where it's unlimited. There's no conversation around capping that. Unlimited cultivate, tough. We have one store there. We never expanded into Michigan just because that has to play out. There absolutely will be a mass consolidation in that market, just like there will be everywhere. We're focusing more on the limited license markets and increasing caps at those. When you look at, I've just had this conversation, take a look at Arizona. A good example of kind of a mix between cap, no cap. You have a cap on the retail stores, unlimited on the cultivation side. But that's finally starting to rationalize. Because you can't have unlimited grow. You see all these things starting to shut down, and the market becomes more mature. For us, we have eight stores there. It's a phenomenal business because we're fairly vertical, and it's another place where we would like to invest. California and Michigan, we're not touching it because there's a lot of work that needs to be done there, and someone will go do it, most likely won't be us in the near term. But in states like Massachusetts where we can do our six stores and we can go do JVs, we'll do that. We've shown to have done that. We've done JVs in Connecticut. We do them in other places, where there's a more thoughtful approach to that business, and if you get the pricing similar to Arizona, but you grow at the right price, it's still a phenomenal business. You have to continue to get more efficient in your grow and put up high yields and bring your costs down. But when you convert or integrate into the store, it's a great long-term business, and if you look at both Massachusetts and Arizona, even though they've been around for a long time, they're still tremendous businesses when you can have real scale. So where we can have scale, we'll do it. Where you don't have scale, it doesn't work as well. One follow-up question related to consolidation on the 280E retroactive look-back. Does that become a cash flow generator for Verano because of what you took the tax hit in prior years? Or are you more like some other companies that just took a reserve, and how does it play out for Verano on the 280E side? It'll apply to the UTP that's already in place. Say again. It will apply, whatever retroactive component there is in place, it will come to be. It will apply to the UTP that is already there, so it will not add additional cash to our balance sheet. Will not yet. No. Unless something really magnificent happens. Never say never, but the way it currently stands right now, I look at 2023 as kind of the target. Chatter's three-year look-back. Right, because that's when the HHS recommendation was made. We've already accrued for that year. You've accrued- Yeah, we've already accrued, so we don't look at it as additional cash. As additional benefit to the product. Correct. Gentlemen- If you select two and then 5, look-back, a one-year look-back, you probably have to take your charge for the two year. Yeah, we'll have to settle that out and pay that out, yeah. Gentlemen, thank you very much. We're at time. Thank you again. Appreciate the time. Thank you. Thanks, everyone.